FOCUS CHINA – WitsView: Taiwan Slightly Surpasses Korea in TV Panel Shipment in Coveted China Market
As panel industry had been stuck in the mud for some time, at the end of 2008, China played a critical role in getting out of the recession mud in the panel industry. In recent years, China has also become the single market that demonstrated the rapidest growth in TV panel demand. Therefore, major global panel makers consider China the key market, and gaining a foothold in this market will ensure a more effective panel outlet.
Based on a survey by WitsView, a research division of TrendForce, in terms of panel makers’ shipment volume to China TV brand vendors in 2Q10, CMI, which has been devoting itself to the business in China for a long time, topped the market share with 23%, followed by Samsung and AUO, each accounted for 22% while LGD had 19%. The top four panel makers provided 88% of total shipment in China’s TV panels.
By regions, the overall shipment ratio of Taiwan panel makers reached 50% which was substantially higher than that of Korea panel makers, accounting for 42%. The remaining 8% were provided by Japan maker and China’s domestic makers. There is less cultural and language barrier between Taiwan and China, which benefits their collaboration. Additionally, government’s implementation of related policies and other flexible partnership, including LCM investment and cell trading business, have been gradually carried out; further, these factors are also the reason that Taiwan panel makers are able to maintain their competiveness, says WitsView.
In terms of the aggregated shipment area, rankings are slightly different. LGD, taking the fourth spot in shipment volume, ranked No. 1 in total shipment area with 24%, since its 42W and above products accounted for a large ratio. Other brand vendors such as AUO, CMI and Samsung each had 21~23%, which is similar to their shipment volume share. On the other hand, since 32W and below TV panel was the mainstream, Japan and China domestic vendors only accounted for 6%, slightly lower than the shipment volume share. Analysts at WitsView further pointed out that Korea vendors still have certain advantages in terms of the new products launch such as LED TV panel and the cost-competitiveness of 42W and above products. These advantages are what Taiwan brand vendors need to keep up with in order to stay competitive in the market.
China market has been buzzing with the news of setting up local panel fabs in China, yet the soonest capacity ramp up is only expected after 2012. Before that, China TV brand vendors’ demand for panels would still rely heavily on the merchant market. The two major Korea panel makers have close relationship with respective leading TV brands, so a conflicting relationship exists in their collaboration with China vendors. However, such issue does not exist among Taiwan panel makers; in addition, they have solid group support on the component supply, TV set design, and assembly. Through the integration in the supply chain, it strengthens their cooperation with China TV brand vendors, which will further soften the impact on Taiwan panel makers during slow season.